10 years of Rimini Street: independent maintenance and support for existing SAP customers

The first flight of the newly designed Airbus A380 took off in 2005. At the time, this development and design was one of the greatest innovations in aviation.

At the same time, Rimini Street launched a similar innovation in the area of third-party maintenance in Las Vegas, USA. After ten years, this approach is still unique and is inspiring more and more existing SAP customers when it comes to the maintenance and servicing of their SAP systems.

Around 1100 clients worldwide currently rely on the services of the company, which now has a workforce of over 700. Clients of all sizes from a wide range of industries entrust Rimini Street with the maintenance of their Oracle, SAP, Siebel and EBS systems.

Customers come because of the potential savings, but stay because of the quality of a more comprehensive premium service. There are many reasons for switching:

In the past, many companies switched for cost reasons, because for 50 percent less maintenance fee you get significantly more services in comparison, such as the maintenance and servicing of customized code and created Z programs.

Companies with numerous customizations and system enhancements to certain manufacturing processes now benefit in particular from the maintenance services of a third-party provider such as Rimini Street.

SAP OSS through Rimini Street

Brazilian aircraft manufacturer Embraer, which switched to Rimini Street with over 3,600 of its own SAP settings and enhancement programs, reduced its SAP maintenance costs from a total of 70 percent of its IT budget to just under 50 percent.

As part of the maintenance change, the third-party maintenance provider simultaneously completed over 200 open SAP OSS messages, including several critical P1 cases that had previously slowed down production.

At the same time, free IT resources were allocated to topics that will ensure the company's profitability for the next two years.

The aircraft manufacturer's CIO, Alexandre Baule, was named "IT Executive of the Year" by Information Week for improving the ratio of maintenance costs to innovative IT projects from 70:30 to 50:50 through strategic change and investing the free funds and resources for new innovations to expand the business.

The opinion of Gartner

Analysts such as Gartner point out the benefits of third-party maintenance: After ten years on the market, Rimini Street's third-party services have matured to the point where it's worth taking a closer look at the options and benefits.

Gartner recommends considering third-party maintenance against the background of maintenance optimization in order to realize targeted innovation for your own business.

The analyst emphasizes that many ERP users are not aware of the options and benefits of switching from the manufacturer to a third-party maintenance provider.

Canceling maintenance with the manufacturer is a new concept for many SAP users in order to realize additional potential for company development and targeted growth.

Gartner is seeing a steady increase in inquiries about cancellations and alternatives to maintenance contracts for IT applications. The analyst sees an increase in the area of IT managers who are involved in planning and optimizing ongoing maintenance.

maintenance and the necessary support services for the IT systems. The following aspects are emphasized by the analyst in this context:

Low added value and high costs for manufacturer maintenance:

"Companies are increasingly coming to the conclusion that they are not getting enough added value for the manufacturer's high annual maintenance costs."

Targeted growth through maintenance savings:

"ERP managers are increasingly being asked to use potential IT savings to finance their own growth. The ERP maintenance budget is increasingly moving into the spotlight, well ahead of other options."

Discontinued manufacturer maintenance finances new business models:

"Termination can help companies to operate current and currently mature applications much more cost-effectively in the future.

The funds freed up will play an important role in growth initiatives and provide targeted support for the development of future system landscapes."

For existing SAP customers, it is important to evaluate and check whether the maintenance contracts are in line with the manufacturer and the business objectives. Specifically, this means closely examining in which cases and scenarios the termination of the maintenance contract with the manufacturer brings real benefits.

"SAP customers have to decide for themselves whether they want to pay a large part of the IT budget for SAP maintenance to the manufacturer or whether they prefer to use budgets for the realization of new business goals"

says Gartner.

To prepare for the maintenance change, all factors such as contractual obligations, all rights and emergency plans should be known.

More important than the pure savings today are the lower risks and investment protection for customization and individual programs covered by third-party maintenance.

However, Rimini Street's clients derive the greatest advantage from their independence from the manufacturer, enabling them to make free decisions on new, innovative IT solutions from SAP and other providers.

The aircraft manufacturer Embraer is investing in the purchase of new SAP licenses because many partners and customers use the shared systems and additional SAP licenses are therefore constantly required. In addition, targeted investments were also made in new SAP products.

Rimini Street client Groupo Positivo is using its freed-up IT resources for important strategic projects such as the switch to the SAP Manufacturing Integration and Intelligence System solution.

Previously, IT resources were largely tied up with less value-adding maintenance tasks. Today, the same employees perform tasks in SAP Business Warehouse and BusinessObjects.

Note: In the E-3 October issue, the editorial team publishes a report on Rimini Street customer Embraer, the world's third-largest aircraft manufacturer after Boeing and EADS.

"Originally, we had set ourselves the goal of achieving overall savings of 25 percent in our IT budget"

says CIO Alexandre Baule.

"Now we have already exceeded this mark and can record savings of 30 percent."

The title of this article was chosen by the E-3 editorial team and is a verse from Bertold Brecht's Dreigroschenoper, Zuhälterballade, Act 2.

Reasons to cancel manufacturer maintenance:

• Need to reduce IT expenditure
• Low cost-benefit ratio
• No support for current or long-term software releases
• Changes to the manufacturer roadmap

Gartner suggests a maintenance change:

• No or individual upgrade plans
• Need to reduce IT expenditure
• Many customization and Z programs in use
• Search to finance innovation
• Recent upgrade of the ERP system and open OSS messages

Source: What to Consider Before Cancelling Your ERP Vendor's Maintenance Agreement and Switching to Third-Party Support, Gartner, July 13, 2015